The credentials are used to address and decrypt the block that stores the user’s account information, so it can be argued there is a technical need to enforce a minimum level for at least the “account secret”, if not the password.
I do like that.
In the alpha, there is a mandatory password complexity though, and I can’t argue against that too much, either. They are using zxcvbn, which can verify the complexity much better, so you’re not restricted to one annoyingly specific idea of the “secure password”.
I may add that, as the project is open source, nothing can stop you from disabling the checks, as all of them are done (and can only be done) on the client side.
Actually, the argument he makes just highlights how people will react to news of breaches. Yes, it’s irrational. Yes, it would still do damage.
$60 million was stolen from Bitfinex. What does it say about bitcoin itself? Nothing. Yet the price plummeted, because hoomans are not rational. Only cats are 
jk